Entries for May 2008

Lou Pearlman—the mind behind boy band sensations Backstreet Boys and 'N Sync—will have plenty of time to plan new song-and-dance routines during the 25-year prison sentence he was given last week.

According to the Department of Justice, in addition to turning teenaged boys into stage-rattling heartthrobs, Pearlman also had a talent for making investor's money disappear.

A federal judge—who apparently still hasn't seen Demolition Man—on Thursday granted Wesley Snipes's request to remain free on bond until his conviction and sentence are reviewed by a higher court, saying that the former action hero turned tax criminal "does not constitute a danger of any kind."

From the judge's order, via the White Collar Crime Prof Blog:

The Court is persuaded by the history of the case and all of the attendant circumstances that the Defendant poses no substantial risk of flight and does not constitute a danger of any kind if he remains at liberty pending appeal.

The FBI is warning consumers to be on the lookout for E-mails purportedly soliciting funds to support the victims of the recent earthquake in China. "Some of the Chinese earthquake scam messages claim to be offering free vacation trips to the largest donors and even use fake logos of legitimate online pay services to fool people," the FBI said in a release.

Similar fraudulent efforts followed other recent tragedies, such as 9/11, Hurricane Katrina, and the shootings at Virginia Tech, the FBI said. Criminals apparently use such events to prey upon the sympathy of individuals.

During his years as a globe-trotting confidence man, Frank Abagnale passed $2.5 million of phony checks in every U.S. state and 26 countries. Now, as a teacher at the FBI academy, the real-life inspiration for the movie Catch Me If You Can trains law enforcement officials to prevent the very crimes he once committed. Abagnale recently spoke with U.S. News about how check forgery has changed over the years, why it remains such a problem today, and how he would swindle consumers—if he were still a bad guy. Excerpts:

How big of a problem is check forgery today?
I teach check forgery at the FBI academy. I really, honestly, truly believed 10, 15, 20 years ago that I would not be talking about it still today. It's amazing to me that check forgery is now at about $20 billion a year, up from about $12.6 billion in 1996. There was an increase in check forgery of over 25 percent last year. It's such a simplistic crime, and we are still very much a check-user society, so checks are still part of our payment system.

In a stirring tribute to a notoriously frustrating game, the alleged ringleader of a $20 million fraud scheme was captured on a golf driving range last week, authorities said. He had been a fugitive for more than two years.

Law enforcement officers arrested 52-year-old Jacob Kim of Palisades Park, N.J., while he was "taking swings" at the Alley Pond Golf Center in Queens, N.Y., according to the Department of Justice. Arresting officers reported finding $48,000 in cash—enough for quite a few range tokens—in his pocket.

And you thought your financial adviser was hosing you? At least he's not tipping strippers with your 5-year-old's college fund. Unfortunately, the clients of John A. Baldo, a former financial adviser from New Jersey, can't say the same.

Baldo was sentenced to 87 months in prison earlier this month for defrauding elderly investors out of hundreds of thousands of dollars and using the proceeds to pamper himself.

According to the Department of Justice, the 39-year-old Baldo obtained nearly $2 million from senior citizens in Massachusetts and Connecticut by convincing them they could enjoy "handsome returns" by investing with his firm, Freedom Financial.

Department of Justice: "Passaic Mayor Samuel 'Sammy' Rivera pleaded guilty today to attempted extortion, admitting that he accepted a bribe from a government cooperating witness who was representing an undercover insurance brokerage company in return for his official assistance in steering public contracts to the undercover company."

DOJ: "A Customs and Border Protection (CBP) officer has been arrested and charged for accepting bribes for fraudulently making and delivering an official travel document."